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GAS – Prices rebound from 7-week low on higher demand

(Montel) European gas prices edged up on Thursday, with the prospect of rising demand lifting the benchmark TTF front month from a seven-week low reached in the previous session.

The front-month contract on the Dutch TTF hub was last seen at EUR 42.40/MWh on Ice Endex, up EUR 1.09 on the day. On Wednesday, it slumped below EUR 40/MWh for the first time since 9 October.

In the UK market, the NBP front-month contract was last seen up 3.19p at 108.85p/th.

Market participants attributed the price gains to a pickup in demand manifesting in higher withdrawals from storage units amid a current cold snap across northern parts of Europe.

Withdrawals from EU storage units rose to 5 TWh on Monday and 5.7 TWh on Tuesday, well above the average of around 3 TWh from last Wednesday to Sunday, according to the latest figures from Gas Infrastructure Europe.

Nevertheless, the freezing temperatures on average this week should abate next week, while overall storage levels remain well above average for this time of year.

The overall outlook remained bearish for gas prices, said one trader based in Poland.

Milder weather ahead
Temperatures in Germany, Europe’s largest gas consumer, were revised up by 1.4C for next week in the latest two-week forecast, according to Montel’s Energy Quantified.

Meanwhile, flows from Norway were expected to reach 353mcm today, up from 342mcm on Wednesday, showed data from Gassco, the system operator.

European storage units were last seen 96.5% full on Tuesday, 3 percentage points higher than the same day in 2022.